More budget cuts planned for Penn State's commonwealth campuses as part of 2026-27 allocations
In its third year of a revamped, data-driven budget model, Penn State released budget allocations for 2026-27 this week. These are initial allocations for education and general funds based on tuition and state funding projects, the news release states. Additional funds for annual salary increase and faculty promotions will be allocated to unit budgets.
Sara Thorndike, senior vice president for finance and business/treasurer and chief financial officer for Penn State, said in release the allocations were 'driven by the University's wider efforts to maintain a balanced budget, while focusing on strategic priorities, enhancing the student educational experience, and supporting those areas of the institution where additional investment is needed to meet student demand and realize opportunities for growth.'
Penn State's 20 commonwealth campuses will receive an aggregate allocation of $314.9 million for the fiscal year 2026-27, which includes $30 million in provost subvention, or operating subsidies. The allocation reflects an aggregate decrease of $25 million (7.3%).
Margo DelliCarpini, vice president for Commonwealth Campuses and executive chancellor, stressed the importance of the campuses to Penn State's identity and reaching students across the state. Still, she said they need to 'reimagine' the campus system.
'In higher education, student expectations, demographics, and the delivery of education in general have changed drastically since our 20-plus campus model took shape in the middle of the 20th century,' DelliCarpini said in the release. 'The complex work to reimagine our campus ecosystem for the future — which has been underway for more than a year — is essential and continuing with many contributors from across Penn State.'
Individual campus budgets won't be finalized until later this year, after subvention is allocated. The release states the subvention decisions will be informed by the Future State process and an additional review and conversation between the Office of the Provost and Office of the Vice President for Commonwealth Campuses.
The budget model also includes $50 million in presidential strategic funds (intended to support priorities, like enrollment management or new programs, for example), but it has not yet been decided how these funds will be used.
The majority of commonwealth campuses have seen a steep decline in enrollment over the last 10 years, with eight campuses experiencing decreases of at least 30% over that time period. Amid a budget crisis, the university announced plans last year to significantly cut the commonwealth campuses' central budget for fiscal year 2025-26. The university then rolled out a buyout program at the commonwealth campuses last spring in which 383 Penn State commonwealth campus employees opted to participate.
With that, the university implemented a new shared regional administrative model for the commonwealth campuses. Additionally the university continues to look at more shared service opportunities, similar to the 'optimized service teams' the university instituted in the summer at commonwealth campuses.
Penn State leadership has not given a direct answer on if campus closures are in the future.
Most academic colleges at University Park will see a 'modest increase' in allocations for fiscal year 2026-27, the release states. The allocation shows an overall aggregate increase of 3.6%. Allocations for the central administrative and student support units also show an aggregate increase of $1.8 million, but most administrative and student support units will remain unchanged from 2025-26, the release states.
'Our goal is to land in a place where we're not seeing large fluctuations every year, and our budgets are balanced and appropriately sized to support our students' success and our research mission,' said Tracy Langkilde, interim executive vice president and provost.
The University Park academic colleges will receive $10 million in provost subvention.
The college showing the largest funding increase is Donald P. Bellisario College of Communications with a $3.3 million, or 14.97%, increase, followed by Information Sciences & Technology ($4 million, 12.40% increase). International Affairs will see a $409,876 decrease (minus-16.63%) and Penn State Dickinson Law's allocation decreased by $2.29 million (minus-12.08%).
The release states conversations and budget planning will be ongoing throughout the spring as all unit budgets are constructed and finalized. Penn State's final 2026-27 budget – which will include tuition and fee schedules – will be presented to the board of trustees for approval in July.
The 2025-26 operating budget and tuition schedules will go into effect July 1 and were previously approved by the trustees last year July.
More details on the allocations can be found on Penn State's budget website, budgetandfinance.psu.edu/budget-allocations.
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